Question

week 5 case study assignment is the fourth of a series of analytical tasks, spanning several weeks. Your task involves an analysis of general economic conditions or systemic risk,i.e.the risk that affects all industries and companies, in the u.s. macroeconomy.

Answer 1

ANALYSIS OF ASSET CLASSES, question there are three classes of As per given assets: * v.s equities * Uis Treasury * cash * us - Equities; is an asset class that invest in common astacks of the companies listed in us Stock exchanges. The crisk is highest among all asset 1. classes, as return is also highest. • By investing in equity, you will get 1. The ownership in company. • so you will entire for váting rights . Dends, Bonus, splits of Rights issue. • S. &P 500 has given annual xhon [CACIR? . 16% - 18% from 1970- 2007.

US - Treasury :- • us. Treasury is a Debt-asset class, whose x bars as the satest in all the assets classes • It is backed by us gout & red. • Returns are bixed, risk is very low. As of now, us treasury has never defaulted • many corporates uses us- Treasury as their - liquid funds. n. eash i • cash is nothing the cash. Currency or Bank Balance you hold in the account.

Justification on V PV . As por my standard rules, Generally we invesit the money in the Debut or us treasury as per age. For example in Investor who is 30 years old, his 30% eshould be invested. in De but do 70% un equits Investor who is 70 years old then we invest 70% in Debut & 30% in e